Friday, August 20, 2010

Top 6 most indebted countries (and why)

1. Ireland - Debt/GDP: 997%

2. Netherlands - Debt/GDP: 467%

3. United Kingdom - Debt/GDP: 409%

4. Switzerland - Debt/GDP: 273%

5. Portugal - Debt/GDP: 228%

6. Austria - Debt/GDP: 214%

While the U.S. and Canada have large economies, their respective debt-to-GDP ratios are 93% and 62%. The U.S. gets most of the attention because of the size of the numbers that comprise the ratio - $13.5 trillion debt (June 2009) and $14.4 trillion GDP (2009 estimate).

By comparison, China and India have ratios of 7% and 20% respectively. Their economic growth rates have also exceeded the western nations over the past few years, thereby keeping their debt ratios relatively low. If the western nations don't implement policies to reduce their debts, they run the risk of jeopardizing future economic growth and prosperity.